BUSINESS SPONSORSHIP OBLIGATIONS KNOWLEDGE BASE
In this article we explain the ongoing obligations on companies who sponsor foreign workers on 457 or 482 Temporary Skills Shortage (TSS) visas.
Note: while new 457 visas can no longer be granted and have been replaced by the 482 visa, there are still many employees in the workforce who were originally employed under a 457 visa which is yet to expire.
Approved business sponsors must comply with their respective sponsorship obligations for the duration of their approved business sponsorship (usually 5 years).
The Department of Home Affairs (DOHA) monitors a business’ compliance with its sponsorship obligations while it holds an approved business sponsorship and for up to 5 years after the business sponsorship expires (as businesses may still being employing staff who have visas that expire after the business sponsorship expires).
DOHA also monitors 457 or 482 visa holders to ensure they, as individuals, comply with the conditions of their visas.
Below are the obligations business sponsors must comply with, arranged from the commencement of employing a skilled foreign worker on a 457 or 482 visa until the end of their employment in Australia.
Make sure the recruitment practices do not discriminate against Australian citizens, keep records of the recruitment process.
Businesses are required to conduct “Labour Market Testing” which generally involves advertising the relevant position to the local labour market in order to show that there is no suitable Australian citizen who can carry out the role. The recruitment cannot be carried out in a way that makes it difficult for Australian citizens to apply for or obtain the role. The company must keep records of the Labour Market Test results and reasons why any other candidate for the advertised position was not considered to be suitable for the role.
Do not pass on costs to the sponsored employee
Some of the costs which it is unlawful to pass on to the sponsored employee are:
- Costs in applying for and obtaining a business sponsorship approval from the Department of Home Affairs;
- Government lodgement fees for business nominations;
- Financial contributions to the Skilling Australian Fund Levy;
- Professional fees charged by third parties associated with an application for a company business sponsorship and a business nomination;
- Recruitment fees (if using a recruitment agency in the Labour Market Testing process);
- Advertising fees if utilising a fee-paying employment search site (such as Seek, Indeed, etc) for the Labour Market Testing process;
- Assessment of candidates who applied for the advertised position;
- Remuneration paid to human resources staff;
- Any outsourced background checks, police checks and psychological testing required by a candidate for the advertised position; and
- Any domestic or international travel to interview candidates for the advertised position.
Ensure that the terms and conditions of employment provided to the 457 or 482 visa holder match the information that was provided to the DOHA
In relation to remuneration, the 457 or 482 visa holder’s remuneration must be at least the level provided on the business nomination approved by DOHA.
There is no need to notify DOHA of any periodic salary increases. However, there may be an obligation to notify DOHA if the salary level falls below what was disclosed to DOHA on the approved business nomination.
Ensure that the 457 or 482 visa holder only works in the approved nominated occupation
If the 457 or 482 visa holder’s duties and responsibilities materially or substantially change enough to require a change of occupation, then a new business nomination should be lodged.
Some examples of changes that would not be permitted include the following:
- a change from an ANZSCO 225113 Marketing Specialist to an ANZSCO 131112 Sales and Marketing Manager;
- a change from an ANZSCO 223111 Human Resource Adviser to an ANZSCO 132311 Human Resource Manager; or
- a change from an ANZSCO 132111 Corporate Services Manager to an ANZSCO111211 Corporate General Manager.
Notify the Department of Home Affairs (DOHA) in writing within 28 days when changes occur
Notifiable events include, but are not limited to, changes with:
- Legal name of the business;
- Trading name;
- Registration details with ASIC;
- Business structure (restructuring, redeployment of business lines or departments);
- Internal contact person that is authorised to liaises with DOHA;
- The business’ owners, directors, principal or partners;
- The business address;
- The business becoming insolvent or bankrupt;
- The business going into receivership, liquidation or administration;
- The business ceasing to exist as a legal entity (business winding up);
- Whether the visa holder did not commence employment with the business in Australia;
- When the visa holder ceases employment with the business before the visa term expires; and
- When the visa holder has a change of duties not previously provided in the approve business nomination.
Ensure the business keeps appropriate records
Examples of records that must be kept include the following:
- Records of any event the business is required to report to DOHA (see item 5 above), including the date and method of notification and where the notification was provided;
- Records of tasks performed by, or the current position / job description of, the 457 or 482 visa holder working in the nominated occupation and the address where these tasks were performed;
- The full, written contract of employment between the business and the 457 or 482 visa holder;
- If there is an equivalent Australian citizen or permanent resident worker employed by the business in the workplace keep the full, written contract of employment between the business and the 457 or 482 visa holder equivalent worker;
- Records the business is required to keep as party to a workplace agreement, if applicable;
- Earnings paid to the 457 or 482 visa holder (payslips);
- Money applied or dealt with in any way on behalf of, or as directed by, 457 or 482 visa holder (such as voluntary salary sacrificing, requests to be taxed more than is required by law, etc.);
- Non-monetary benefits listed in the business nomination and subsequently provided to the 457 or 482 visa holder. Record the agreed value and the time at which, or the period over which, those benefits were provided (car allowance, phone allowance, housing allowance, education allowance for dependent family members, etc);
- Where the 457 or 482 visa holder ceases employment and prefers to return to the country of origin, a copy of the written requests for payment of travel costs for the 457 or 482 visa holder or their family, when the written request was received, how and when the business paid the travel costs, how much was paid, and who the business paid it to; and
- How the business is complying with the training obligations if the business was lawfully operating in Australia when DOHA approved the business sponsorship or the new varied terms of the business’ approval.
Provide records and information upon request by the Department of Home Affairs
These records may be:
- Records a business is required to keep under Commonwealth, state or territory law; and
- Records a business is obliged to keep as a business sponsor.
Such records must be provided to DOHA within the timeframe requested.
Pay travel costs for 457 or 482 visa holders departing Australia
If a 457 or 482 visa holder ceases employment with a business sponsor and requests in writing for the business to provide travel costs to depart Australia, the business sponsor must provide for these travel costs to the primary visa holder and any accompanying family members holding dependent visas within 30 days.
Reasonable travel costs include:
- Travel from the 457 or 482 visa holder’s residence to the airport;
- Economy class air travel to the 457 or 482 visa holder’s country of passport; and
- Travel costs for the accompanying family members who hold dependent 457 or 482 visas.
Pay costs to locate and remove an unlawful non-citizen (former employee)
If a business’ 457 or 482 visa holder or any of their accompanying dependent family members overstay their visa(s) in Australia, then the business sponsor may be liable for the relevant Australian government agencies locating and/or removing them from Australia.
These costs are capped at $10,000 (less the costs the company have already paid for travel costs).
Cooperate with Fair Work Inspectors
Fair Work Inspectors have the authority, amongst others, to investigate whether a business is complying with its sponsorship obligations, whether a business employed a foreign national with no work rights in Australia, and whether there are any other circumstances that attracts administrative action.
Business sponsors must:
- Provide Fair Work Inspectors access to the business premises and to any person in the business premises;
- Produce and provide documents requested by Fair Work Inspectors; and
- Comply with any other lawful request made by a Fair Work Inspector.
These business sponsorship obligations are outlined here in full: https://immi.homeaffairs.gov.au/visas/employing-and-sponsoring-someone/existing-sponsors/standard-business-accredited-obligations
Penalties for Breaching Business Sponsorship Obligations
Where breaches are identified, the business sponsor may faces penalties. These penalties may be imposed as one or more of the sanctions listed below.
Administrative sanctions include:
- Imposing a temporary bar preventing the business from sponsoring any additional foreign nationals on 482 visas for a specified period of time;
- Refusing an application for a lodged 482 visa; or
- Cancelling all 457 or 482 visas approved under the approved business sponsorship.
Note: a business may face additional administrative sanctions in instances where:
- The business demonstrates that they no longer satisfy the criteria to hold a business sponsorship;
- The business’ 457 or 482 visa holder breaks a law requiring them to hold the appropriate licensing, registration or membership needed to work in the nominated position;
- The business provides false or misleading information to the Department of Home Affairs or the Administrative Appeals Tribunal; or
- The business is found by a court or competent authority to have contravened a Commonwealth, state or territory law.
Enforceable undertaking sanctions include:
- A written assurance from the business sponsor that certain actions will be completed to demonstrate the identified breaches of sponsorship obligations are rectified; and/or
- Requiring the business sponsor to implement systems to ensure future breaches do not occur.
Civil sanctions include:
- Issuing an infringement notice to a body corporate of up to $12,600 for each breach;
- Issuing an infringement notice to an individual of up to $2,520 for each breach;
- Seeking a court-imposed a civil penalty order to a corporation of up to $63,000 for each breach; or
- Seeking a court-imposed a civil penalty order to an individual of up to $12,600 for each breach.
How Employment Innovations can help
At Employment Innovations, we provide clients with high-quality migration services, including managing business sponsorship obligations. Our qualified migration agents can help with any visa and sponsorship needs.
About Employment Innovations
Employment Innovations is one of Australia’s leading providers of employment services designed to increase productivity and ensure compliance. Its services and solutions include all the tools that every Australian small to medium sized employer needs – including workplace advice, legal services, payroll solutions, migration, human resource management and HR software.
The information provided in these knowledge base articles is general in nature and is not intended to substitute for professional advice. If you are unsure about how this information applies to your specific situation we recommend you contact Employment Innovations for advice.
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